It protects patients, insurance providers and employers from incurring additional costs for the treatment of avoidable, surgery-related complications.

“This warranty embodies all that Virginia Mason stands for,” Chairman and CEO Gary S. Kaplan, MD, said. “It is centered on the needs of the patient, with a focus on high-quality outcomes.”

Virginia Mason is the first hospital in Seattle and Washington state, and among the first in the nation, to offer a surgical warranty for total joint replacement. The warranty is part of a bundled-service contract available to insurance companies and businesses. The warranty covers the full range of care – diagnosis, surgery and rehabilitation – for an adult patient’s hip or knee replacement when all services are delivered by Virginia Mason. The warranty does not cover complications due to failure of the surgically implanted hip or knee device.

“Health care costs must be tamed,” Dr. Kaplan said. “We view our surgical warranty as a significant step in that direction. Offering this assurance speaks to the skill of our surgeons and of their teams, and of our willingness as an organization to stand behind their work.”

The warranty expands the opportunity for more businesses to access the high-quality bundled service that is the foundation of Virginia Mason’s inclusion in the Employers Centers of Excellence Network. Hospitals in the national network, established by the Pacific Business Group on Health Negotiating Alliance in 2013, provide predictable-cost knee and hip procedures for employees of several large companies, including Walmart and Lowe’s.

Driven by demand from the aging Baby Boomer generation, the number of hip and knee replacement surgeries has dramatically increased since 2000 and costs Medicare alone about $6 billion annually, according to various reports. More than 719,000 knee replacement surgeries and 332,000 hip replacements were performed in 2010, according to the National Center for Health Statistics.

“Under the current reimbursement system in our country, hospitals are often paid more for surgery that does not go well than for surgery that is completely successful,” Dr. Kaplan said. “We find this unacceptable and contrary to the needs of patients, employers and insurers paying the bill.

“At Virginia Mason, we are determined to reverse this trend as we make health care better and more affordable,” he added. “Through our application of Virginia Mason Production System principles, we’ve been able to design consistently high-quality care pathways for orthopedics and other services.”